Decomposing the value premium: The role of intangible information in the Chinese stock market

Ho, Kin‐Yip; An, Jiyoun

doi:10.1016/j.ememar.2020.100700

Cited by 3 publications

(3 citation statements)

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“…Previous studies have shown that investors and security analysts overreact to information (DeBondt and Thaler, 1985, 1990). In line with these findings, Ho and An (2020) further find that intangible assets are information that causes overreaction among market participants in the Chinese Stock Market. Consequently, firms with intangible assets are vulnerable to crash risk in the future.…”

Section: Introductionsupporting

confidence: 76%

“…They believe that intangible assets presented in financial information contain essential information about future benefit of the firms (Whitwell et al, 2007). Investors even overreact to information on intangible assets (Ho & An, 2020). This situation stimulates firms to report more intangible assets in their financial reporting.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Information asymmetry leads to stock mispricing by market participants. Investors overreact to intangible information, which causes the stocks to be overpriced (Ho & An, 2020). Nowadays, investors are exposed to the innovation hype of non-accounting information.…”

Section: Literature Reviewmentioning

confidence: 99%

See 2 more Smart Citations

Intangible Assets and Crash Risk: The Case of Low Intellectual Capital Firms in Indonesia

Sulistiawan

Rudiawarni

Sergi

2022

The American Economist

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This study explores how intangible assets affect crash risk in Indonesia as the representative of emerging markets, especially for low intellectual capital firms. We employ regression analysis to investigate the effect of intangible assets on crash risk in Indonesia. The findings suggest that firms with intangible assets are more vulnerable to crash risk. Our further investigations also find that intangible assets stimulate crash risk in low IC firms, but intangible assets cannot explain crash risk in high IC firms. This study implies that Indonesia’s low IC firms with intangible assets use explorative innovation strategies rather than exploitative strategies. This paper warns investors about the increasing crash risk of overvalued intangible assets and guides investors in anticipating future crashes. JEL Classifications: G11, G40, O31

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Section: Introductionsupporting

confidence: 76%

Section: Literature Reviewmentioning

confidence: 99%